Local Government Finance (England) Special Grant Report (No.101) (HC 942), on Personal Social Services Performance Grant for 2002-2003

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Mr. Wilshire: Of course I can. That is the amount that Surrey can afford to pay; it is the reason why beds are being lost as residential homes in my constituency and throughout the county are being closed and turned into flats. The figures represent what people are prepared to pay and there are no suppliers willing to provide at that price. The figures do not represent the true cost, which is why Surrey has no beds and bed blocking is rocketing again, despite every attempt to stop it happening.

The reality is that any distribution based on SSA will be unfair to people in the south-east. I therefore urge the Government to find another mechanism for distributing the money. The order may say that it is done fairly, but I respectfully suggest to the Minister that using the SSA is grossly unfair. Between now and next year I hope that the Department will think about the matter and find some other mechanism which will meet the proposal's aspirations.

The fifth matter on which I would like the Minister's comments is that of rewarding staff. I understand why there will be some nervousness about doing the obvious thing. When I ran a business I rewarded staff by paying them more, and then even more. That seemed to be what they understood best and I got the best results out of them. There appears to be no such willingness to say, ''If they do well, pay them more,'' because that would solve some of Surrey's problems. If we could pay above the national scales we would get people to work in public services in Surrey, which is proving more and more difficult. As for rewarding people by saying, ''We will make your office better, and train you,'' I would have thought that the people who needed the most training were those who did not achieve, rather than those who did. Training is not a reward but an absolute necessity. If the extra training is to be given to people who are best anyway, the Government will not achieve what they want.

Will the Minister reconsider her definition of reward so that staff can have Christmas bonuses if they do well, because that will encourage them to do even better? Giving them a better office, more training or another computer is not likely to achieve the Minister's aim. I support what she is trying to do, but she has not got it right.

My last point is about the Government's wonderful, hare-brained idea about penalties for delayed discharge, mentioned by my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton). The reason why there are delayed discharges is the Government's complete and utter failure to fund local authorities properly. Social services funding in Surrey is a disgrace. It is crazy to penalise local authorities for the abject failure of the Government. Having behaved in that crazy fashion, then to say, ''The penalty we will impose on you is to fine you,'' means that there will be even less money to provide intermediate care. The policy is crazy and the penalty is doubly crazy.

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11.24 am

Jacqui Smith: The debate has been interesting and reasonably well informed and I shall respond to some of the issues that hon. Members raised.

I am glad that on the whole the hon. Member for East Worthing and Shoreham welcomed the fund and the extra money. He made an important and fair point about differentiation in respect of the performance fund. The determination of that fund in terms of monitoring the schemes does not differ between zero and one-star authorities. However, the performance fund is only one of the ways in which we are differentiating between authorities, depending on their star ratings. For example, as well as having the freedom to spend the performance fund on any part of social services—this should also answer the question from the hon. Member for Cheadle—three-star authorities will be further developed next year with additional grants. They will also receive lighter-touch inspections, have to do less form filling and have more freedom to decide what to focus on in the development of local public service agreements.

In contrast to one-star councils, zero-star councils will be expected to produce a performance improvement plan and, by tomorrow, all will have met the chief inspector to investigate that plan. In four cases, we will be sending in outside assistance in the form of performance action teams to challenge those authorities and enable them to improve more quickly. Zero-star councils will also have a tight time scale in which to improve and will be prevented from receiving beacon status in a Department of Health-led scheme.

One-star councils will be subject to a different inspection regime that is much less interventionist, and inspections of two-star councils will also differ. One-star councils will be eligible to apply for beacon status. We have differentiated the conditions for grants, inspection and monitoring, the extent of form filling, and our approach to beacon council schemes and local public service agreements. The relationships in those different areas clearly differ for zero, one, two and three-star councils in a way that will promote improvement.

The hon. Member for East Worthing and Shoreham asked why we focused the grant on intermediate care. As I made clear in my opening speech, it is an important area in which we need new services and innovation. Intermediate care is a new form of care that was introduced mostly after the NHS plan and national framework for older people. That is why a grant that prompts innovation is appropriate. However, we have made it clear that three-star authorities that have proven success in both adult and children's services in developing desired outcomes, which we want to see for older people, will have the flexibility to choose what to spend on social services.

The hon. Gentleman raised a point about Haringey and the council's children's services. As I have said, the zero-star councils, of which Haringey is one, will be subject to other ways of prompting progress and countering poor services. The grant is important, but only one part of the Government's approach to monitoring intervention and promoting progress.

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Tim Loughton: My point was that of the local authorities' estimate of a £1 billion shortfall in social services funding, 70 per cent. relates to children's services. Most local authority social services departments state that their biggest shortfall is in children's services, but the special grant addresses intermediate care for older people. Will we see a similar grant for the other side of the equation, given that the Minister has used the star rating, which balances equally children and adult services?

Jacqui Smith: We have seen the five-year children's grant associated with the quality protects programme, which promotes good practice. The fact that there has tended to be spending above SSA in children services has more to do with the lack of funding previously available to local authorities than with whether we introduce grants such as this. I might say more about funding in a moment.

The hon. Member for East Worthing and Shoreham also talked about evaluation costs. Performance fund money can be used to carry out the evaluation, although the form is short—only a page of A4—and can be downloaded from the Department of Health website. It asks similar questions to the spring monitoring report questions for zero and one-star councils, so the answers should be readily available.

We are distributing £48 million to local authorities because, as I suggested in my introductory speech, £2 million is being used to fund the necessary intervention in some of the authorities that the hon. Gentleman highlighted, such as Haringey. That ensures that we can fund the intervention and monitoring necessary for authorities that are on special measures or that have zero stars to improve. The money does not go to some central bureaucracy; it is clearly focused on ratcheting up performance in those authorities that have not provided the services that they should have for vulnerable people.

Tim Loughton: I am grateful to the Minister, because she mentioned only the figure of £50 million in her speech and in the press release. Will she confirm that that £2 million to monitor and ratchet up the performance of zero-star authorities in particular will not go to the sharp end of providing the additional services that those authorities obviously need, but will be used purely to provide inspectors, monitoring, reports and so on?

Jacqui Smith: The money will go to the sharp end of ensuring that the performance action teams that go into authorities that are failing vulnerable people make a difference and ensure that services deliver for those people.

The hon. Gentleman asked about the commission for social care inspection. Yes, legislation will be needed, but it is worthwhile remembering why we are establishing the commission, which brings together the regulatory and inspection functions of the National Care Standards Commission, and the inspection functions of the social services inspectorate. The reason is to ensure that, as extra money goes into social

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services and social care, we are clear about the value being delivered and the standard of services being provided for some of our most vulnerable people.

I do not accept that that reform suggests that the National Care Standards Commission does not have an important role to play. The function of that commission, as I explained when I spoke to its area managers last week, is to ensure that for the first time there is consistency of regulation throughout the country, in line with national minimum standards and in a way that has not been seen before, but that will help to improve standards among a range of care providers. That function will be transferred to the new commission for social care inspection. In other words, the job goes on, even if the organisational structure changes to bring more coherence to social care inspection and regulation.

Several hon. Members referred to delayed discharges and in particular the Government's proposals to introduce into the system the financial incentives necessary to help to make further progress in tackling that problem. I say to the hon. Member for Cheadle that people cannot argue for reductions in ring-fenced grants—which have had quite considerable success in reducing delayed discharges—and then argue against other methods of introducing into authorities, and the relationship between particularly acute trusts and the community, the incentives and system that will enable us to continue to drive down the number of people who are in hospital when they should not be. That is alongside investment that will enable social services departments to develop those alternative provisions.

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